Having no CORE VISION is the single most important reason why
Family Businesses don't continue into the Next Generation.

 
 
   

June 3rd, 2014

Root Causes - Getting to the Bottom of Issues Brings Returns to the Top
#10 of my Thought-Provoking Position Papers for Family and Closely-Held Businesses


Having no CORE VISION is the single most important reason why Family Businesses don't continue into the Next Generation.

Most families would like to keep the business in the family and the family in the business. But very few families translate that into a core vision that transcends generations, or don’t take the necessary steps to implement it.

Here is a quote from a family that is a living example of multi-generational success: “We do not sell that piece of forest because it’s our heritage and the basis of the long term stability of our family – financially and emotionally. We don’t really consider it ours in the sense that the current generation has all rights to it.”

This means two things:

  1. Each generation keeps up the family business under a fiduciary duty, not focused on individual or current interests, but the long-term viability of the family’s legacy.
  2. If the philosophy is that “we are borrowing this from future generations”, then the obligation of the current generation it to keep it in top shape, guided by the long-term view.

Let me be clear: No family business has to continue into the next generation. But if your family really wants to, then don’t just pretend but take the necessary steps:

Create a framework that

  • accommodates the evolution from a sibling partnership to a cousin consortium (with many family “beneficiaries” that may or may not work in the business)
  • institutes succession planning as an ongoing process
  • provides a mechanism for individuals to leave, without jeopardizing the whole
  • starts entrepreneurial education early for young family members
  • awards leadership positions only by merit and qualification, with clear selection process
  • ensures career development plans are in place for the next generation (family or not), with conditions such as:
    • relevant education, especially in business
    • minimum outside experience of two years, including a meaningful promotion

That’s were I can help: Mentoring and coaching the next generation.

  • creates an ongoing mechanism for transferring the “Business Magic” that maintains your competitive edge as a family’s business
  • institutes regular meetings of the larger family – for fun events and for information about the business
  • includes a simple Family Code of Conduct, with a mechanism to deal with conflict (I can help you with Family Dynamics)
  • puts investing over consuming, performance over entitlement
  • incorporates an independent outside perspective, for example through a strong business advisory board or a trusted sounding board like myself.

The vision carrying this framework needs to be a shared vision agreed upon by all family owners. Drafting and implementing this framework is complex, requires focused discussions and will take time. I can help you by facilitating this process (Family Dynamics).

Pitfalls and how to avoid them

  • Not even getting started: This is overwhelming and it’s hard to envision the steps that will get you there. Let me help you draft and implement an action plan that breaks it up into doable steps and will keep you on track.
  • Everybody in the family is pulling in a different direction. I can help to facilitate an open discussion including all “players”, in order to get clarity about the various positions and develop viable solutions. 

What you gain:

  • Clarity for you and your family about what it takes to maintain a multi-generational business legacy
  • Awareness of options
  • A framework that ensures long term viability and stability for the family, the business, its employees and customers
  • A solid foundation for generations to come
  • Pride about maintaining your family’s legacy
  • A sense that your family is controlling its own destiny

The rewards: Less stress, more fun, and the long-term health of your business and family.

I help Business Families to create and maintain their own Success Loop.

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Please contact me for a discussion about your own business situation and how I may be able to help you.tefan@voswinkel.ca

Visit my website and sign up for my free monthly Position Papers and Case Studies

Stefan Voswinkel, President
stefan@voswinkel.ca
Direct: 867-456-7506

© All rights reserved, Stefan Voswinkel, President of YLynx Management Consulting, Inc.
Please state source if you quote me.

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Biography Stefan Voswinkel, Principal
Stefan has the unique perspective of 25 years in entrepreneurship, large and small firms, government, and international business. This and his own family business background give him the passion to effectively help family- and closely-held businesses. He can take the best practices in family businesses to any location globally. Stefan has acquired rare insights into human relationship factors that determine success or failure.

His results fly in the face of the high failure rate of sustaining family businesses into the next generation.

Stefan is the resource for entrepreneurs of all generations. He is “The Family Business Catalyst”!

Stefan is a sought after speaker and his firm was recently nominated for “Most Innovative Company” in UpHere Business magazine’s Frozen Globe Awards.

Stefan has a combined degree in business and engineering, is certified in Change Management, and a graduate of the Family Enterprise Advisor program at the Sauder School of Business.

He has brought value to the community, for example by taking on leadership roles in Rotary and mentoring business students. He has built his global perspective by travelling to 30 countries.

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